The European Council and European Parliament have reached a provisional agreement in the review of the Markets in Financial Instruments Regulation (MiFIR) and Second Markets in Financial Instruments Directive (MiFID II). A key decision made is to establish EU-level consolidated market data, or consolidated tapes.
The discussion on consolidated tapes is one that has been going on for more than a year without result, with many EU exchanges resisting the regulatory initiative. With this provisional agreement, consolidated tapes will finally become reality. In a press release, the Council states that “market data from all trading platforms will be included in consolidated tapes, which will aim to publish the information as close as possible to real time”. Investors can thus expect “up-to-date transaction information for the whole of the EU”.
Another decision reached in the agreement is a ban on payment for order flow (PFOF), disallowing brokers from being paid for forwarding client orders to certain trading platforms.